S-16 CS Ena-shi Power Plant
Security code

6th FP (ended June 2020)

S-8 CS Hiji-machi Power Plant
Asset Manager
Canadian Solar Asset management K.K.

Presentation Materials
Canadian Solar Infrastructure Fund, Inc.

Table of Contents
1. Financial Highlights ・・・ 2

3. Management Policy ・・・ 21

Financial Highlights of 5th FP ・・・・・・・・・
Portfolio Performance ・・・・・・・・・・・
Asset List (1) ・・・・・・・・・・・・・・・・
Asset List (2) ・・・・・・・・・・・・・・・・

New Assets to be Acquired・・・・・・・・・・
7th, 8th & 9th FP Business Forecast ・・・・・・
Historical and Forecasted Dividend・・・・・・
External Growth Strategy (Sponsor Pipeline) ・

3
4
7
8

2. Major Topics ・・・・・・・ 9
AUM Snapshot・・・・・・・・・・・・・・・・
COVID-19 Impact on Index ・・・・・・・・・
Shelf Registration of Bond and Credit Ratings・
Debt Profile (1) ・・・・・・・・・・・・・・・
Debt Profile (2) ・・・・・・・・・・・・・・・
Impact of Curtailment by Kyushu ElectricPower ・・・・・・・・・・・・・・・・・・・
Action towards Curtailment ・・・・・・・・・
Main Points of the Revised Renewable Energy
Act ・・・・・・・・・・・・・・・・・・・・・
Trends Concerning Changes to Other
Important Systems ・・・・・・・・・・・・・
Efforts for Sustainability ・・・・・・・・・・・
Green Finance・・・・・・・・・・・・・・・・

10
11
12
13
14
15
16

17
18
19
20

22
23
24
25

Appendix・・・・・・・・・ 26
Overview of Sponsor ・・・・・・・・・・・・
Vertically-integrated Business Model ・・・・・
Overall Structure ・・・・・・・・・・・・・・
Unit Price Performance ・・・・・・・・・・・
Status of Unitholders ・・・・・・・・・・・・
Balance Sheet for 6th FP ・・・・・・・・・・・
Statement of Income for 6th FP ・・・・・・・
Portfolio・・・・・・・・・・・・・・・・・・・
Leasing Structure ・・・・・・・・・・・・・・
Distribution Policy (Payout Ratio)・・・・・・・
Characteristics of PV Plant Revenue ・・・・・
History of CSIF ・・・・・・・・・・・・・・・
Renewable Energy Market in Japan・・・・・・
Disclaimer・・・・・・・・・・・・・・・・・・

27
28
29
30
31
32
33
34
35
36
37
38
39
40

1

1. Financial Highlights

2

Financial Highlights of 6th FP◼ Operating revenues resulted in the forecasted range though the slightly lower actual energy
output◼ Net income resulted higher than the forecast contributed by efforts in asset management
activities especially for controlling repair expenses and efficient investor relation activities◼ DPU (excl. distributions in excess of earnings) to be increased by JPY 155 due to increase in the
net income. Decreased DPU in excess of earnings by the same amount. JPY 3,700 distribution in
total is unchanged
5th FP(ended Dec.
2019)
ActualMain difference (vs. forecast)

6th FP(ended Jun. 2020)
Forecast@Feb. 13, 2020

ActualIncrease /(Decrease)(vs. Forecast)

Operatingrevenues

Decrease invariable rent

(21)

Operatingexpenses

Decrease in repair
cost/outsourcing
cost/IR activity cost
etc.

(47)

Nonoperating
expenses

Decrease in finance
cost

(10)

Statement of Income Data
(million yen)
Operating revenues

2,088

2,352

2,331

(21)

Operating income

696

814

840

25

Income before income taxes

534

656

692

35

Net income

534

655

691

35

3,650円

3,700円

3,700円

02,310円

2,837円

2,992円

155

1,340円

863円

708円

(155)

Distribution per unit
(including distributions in excessof earnings) (yen)Distributions per unit
(excluding distributions in excessof earnings) (yen)Distributions in excess of earnings
per unit (yen)3Portfolio Performance◼ 6 th FP actual energy output ÷ 6 th FP projected energy output = 98.90％◼ Total energy output(MWh)Projected

15,00010,000

Actual95.4%
100.4%

86.7%

7,789

8,616

6,760

8,652

98.8%

97.1%

13,347 13,190

14,081 13,680

Apr. 2020

May 2020

111.0%

11,49911,032 10,528

12,7655,000
0Jan. 2020Feb. 2020

Mar. 2020

Jun. 2020◼ Energy output by projectS-01 CS Shibushi-shi
Power Plant

150

(MWh)
150

100

100

50

50

0

S-03 CS Kasama-shi
Power Plant

S-02 CS Isa-shi
Power Plant(MWh)Jan. 2020Feb. 2020

Mar. 2020

Apr. 2020

May 2020

0Jun. 2020

S-04 CS Isa-shi Dai-niPower Plant

(MWh)
300

100

100

Feb. 2020

Mar. 2020

Apr. 2020

May 2020

Jun. 2020

Mar. 2020

Apr. 2020

May 2020

Jun. 2020

Jan. 2020Feb. 2020

Mar. 2020

Apr. 2020

May 2020

Jun. 2020

300
200

Jan. 2020Feb. 2020

(MWh)

200

0

Jan. 2020

0

4

Portfolio Performance
S-05 CS Yusui-cho
Power Plant

300

(MWh)
300

200

200

100

100

0

S-07 CS Kasama-shi Dai-niPower Plant

S-06 CS Isa-shi Dai-sanPower Plant(MWh)Jan. 2020Feb. 2020

Mar. 2020

Apr. 2020

May 2020

0Jun. 2020(MWh)

S-08 CS Hiji-machi
Power Plant

300

Jan. 2020Feb. 2020

Mar. 2020

Apr. 2020

May 2020

Jun. 2020

Jan. 2020Feb. 2020

Mar. 2020

Apr. 2020

May 2020

Jun. 2020

Jan. 2020Feb. 2020

Mar. 2020

Apr. 2020

May 2020

Jun. 2020

Jan. 2020Feb. 2020

Mar. 2020

Apr. 2020

May 2020

Jun. 2020

Jan. 2020Feb. 2020

Mar. 2020

Apr. 2020

May 2020

Jun. 2020

(MWh)
400
300

200

200
100
0

S-09 CS Ashikita-machi
Power Plant

100
Jan. 2020Feb. 2020

Mar. 2020

Apr. 2020

May 2020

0Jun. 2020(MWh)

S-10 CS Minami Shimabara-shi
Power Plant (East & West)

300

(MWh)
600

200

400

100
0

S-11 CS Minano-machi
Power Plant

200
Jan. 2020Feb. 2020

Mar. 2020

Apr. 2020

May 2020

0Jun. 2020

S-12 CS Kannami-cho
Power Plant

(MWh)
400

(MWh)
200

300
200

100

100
0

S-13 CS Mashiki-machi
Power Plant

Jan. 2020Feb. 2020

Mar. 2020

Apr. 2020

May 2020

0Jun. 2020

S-14 CS Koriyama-shi
Power Plant

(MWh)
6000

(MWh)
100
75

4000

50

2000
0

25
Jan. 2020Feb. 2020

Mar. 2020

Apr. 2020

May 2020

Jun. 2020

05

Portfolio Performance
S-15 CS Tsuyama-shi
Power Plant(MWh)

S-16 CS Ena-shi
Power Plant

300
200

S-17 CS Daisen-choPower Plant (A&B)

300
200

100
0

(MWh)

100
Jan. 2020Feb. 2020

Mar. 2020

Apr. 2020

May 2020

Jun. 20200

S-18 CS Takayama-shi
Power Plant

(MWh)
4,000

Jan. 2020Feb. 2020

Mar. 2020

Apr. 2020

May 2020

Jun. 2020

Jan. 2020Feb. 2020

Mar. 2020

Apr. 2020

May 2020

Jun. 2020

Jan. 2020Feb. 2020

Mar. 2020

Apr. 2020

May 2020

Jun. 2020

(MWh)
150

3,000
100

2,000

50

1,000
0

S-19 CS Misato-machi
Power Plant

Jan. 2020Feb. 2020

Mar. 2020

Apr. 2020

May 2020

0Jun. 2020(MWh)

S-20 CS Marumori-machi
Power Plant

200
150

(MWh)
300
200

100
100

50
0

S-21 CS Izu-shi
Power Plant

Jan. 2020Feb. 2020

Mar. 2020

Apr. 2020

May 2020

Jun. 2020

Jan. 2020Feb. 2020

Mar. 2020

Apr. 2020

May 2020

Jun. 2020

0

(MWh)
1500
1200
900
600
300
0

6

Asset List (1) – Power Plant Data, Valuation and etc.
Land Rights

Acquisition Price(millionyen)Sep. 16, 2034

Ownership

540

525

1.06

1,224.00

Jun. 8, 2035

Lease-hold

372

345

0.70

931.77

Oct. 31, 2017

Jun. 25, 2035

Ownership/Easement

907

995

2.01

2,127.84

Oct. 31, 2017

Jun. 28, 2035

Lease-hold

778

717

1.45

2,013.99

36

Oct. 31, 2017

Aug. 20, 2035

Lease-hold

670

614

1.24

1,749.30

40

Oct. 31, 2017

Sep. 15, 2035

Lease-hold

949

881

1.78

2,225.08

Kasama-shi, Ibaraki

40

Oct. 31, 2017

Sep. 23, 2035

Lease-hold

850

849

1.71

2,103.75

Hayami-gun, Oita

36

Oct. 31, 2017

Oct. 12, 2035

Lease-hold

1,029

947

1.91

2,574.99

CS Ashikita-machi Power Plant

Ashikita-gun, Kumamoto

40

Oct. 31, 2017

Dec. 10, 2035

Lease-hold

989

929

1.87

2,347.80

S-10

CS Minamishimabara-shi Power Plant(East & West)

Shimabara-shi, Nagasaki

40

Oct. 31, 2017

Dec. 24, 2035 (E)Jan. 28, 2036 (W)Lease-hold

1,733

1,684

3.40

3,928.86

S-11

CS Minano-machi Power Plant

Chichibu-gun, Saitama

32

Oct. 31, 2017

Dec. 6, 2036

Ownership

1,018

1,087

2.19

2,448.60

S-12

CS Kannami-cho Power Plant

Tagata-gun, Shizuoka

36

Oct. 31, 2017

Mar. 2, 2037

Surface rights

514

546

1.10

1,336.32

S-13

CS Mashiki-machi Power Plant

Kamimashiki-gun,
Kumamoto

36

Oct. 31, 2017

Jun. 1, 2037

Ownership/Easement

20,084

21,07142.49

47,692.62

S-14

CS Koriyama-shi Power Plant

Koriyama-shi, Fukushima

32

Feb. 1, 2018

Sep. 15, 2036

Ownership/Easement

246

247

0.50

636.00S-15

CS Tsuyama-shi Power Plant

Tsuyama-shi, Okayama

32

Feb. 1, 2018

Jun. 29, 2037

Ownership

746

755

1.52

1,963.00

S-16

CS Ena-shi Power Plant

Ena-shi, Gifu

32

Sep. 6, 2018

Sep. 12, 2037

Surface rights

757

807

1.63

2,124.20

S-17

CS Daisen-cho Power Plant (A) (B)Saihaku-gun, Tottori

10,447

10,44221.06

27,302.40

S-18

CS Takayama-shi Power Plant

S-19

Location

FIT
Price
(yen)

Acquisition Date

FIT Expiration

CS Shibushi-shi Power Plant

Shibushi-shi, Kagoshima

40

Oct. 31, 2017

CS Isa-shi Power Plant

Isa-shi, Kagoshima

40

Oct. 31, 2017

S-03

CS Kasama-shi Power Plant

Kasama-shi, Ibaraki

40

S-04

CS Isa-shi Dai-ni Power Plant

Isa-shi, Kagoshima

36

S-05

CS Yusui-cho Power Plant

Aira-gun, Kagoshima

S-06

CS Isa-shi Dai-san Power Plant

Isa-shi, Kagoshima

S-07

CS Kasama-shi Dai-ni Power Plant

S-08

CS Hiji-machi Power Plant

S-09

No.

Project name

S-01
S-02

Valuation
Price
Panel
Portfolio %(million
Output (kW)yen) (Note)40

Sep. 6, 2018

Aug. 9, 2037

Surface rights/Leasehold/Easement

Takayama-shi, Gifu

32

Sep. 6, 2018

Oct. 9, 2037

Ownership/Easement

326

327

0.66

962.28CS Misato-machi Power Plant

Kodama-gun, Saitamaken

32

Mar. 1, 2019

Mar. 26, 2037

Ownership

470

462

0.93

1,082.00

S-20

CS Marumori-machi Power Plant

Igu-gun, Miyagi

36

Mar. 29, 2019

Jul. 12, 2038

Surface rights/Easement

850

825

1.66

2,194.50

S-21

CS Izu-shi Power Plant

Izu-shi, Shizuoka

36

Nov. 29, 2019Nov. 29, 2038

Surface rights

4,569

4,528

9.13

10,776.80

100.00119,746.10

Total(Note)

48,844

49,588“Price” refers to the median project valuation report amount, which is the estimated values provided to us by PricewaterhouseCoopers Sustainability LLC (S01 – S18)
and Ernst & Young Transaction Advisory Services Co., Ltd.(S-19 – S-21) in its project valuation reports as of June 30, 2020.

7

Asset List (2) – Operational Result for 6 th FP(in thousand yen)No.

Project name

Variable Rent andOther Revenues

Basic Rent

Rental Expenses(incl. depreciation
expenses)

Depreciation
Expenses

Net Operating
Income after
Depreciation
Expenses

S-01

CS Shibushi-shi Power Plant

18,632

3,336

13,663

9,472

8,304

S-02

CS Isa-shi Power Plant

14,2403,522

11,907

7,837

5,855

S-03

CS Kasama-shi Power Plant

35,147

14,79521,068

14,462

28,970S-04

CS Isa-shi Dai-ni Power Plant

29,3605,875

24,343

16,457

10,892S-05

CS Yusui-cho Power Plant

26,691

3,444

21,577

14,263

8,558

S-06

CS Isa-shi Dai-san Power Plant

35,514

7,953

30,123

19,861

13,343S-07

CS Kasama-shi Dai-ni Power Plant

34,72014,507

26,98817,604

22,238

S-08

CS Hiji-machi Power Plant

37,757

10,96432,021

22,07016,700S-09

CS Ashikita-machi Power Plant

35,571

8,257

30,53920,216

13,290S-10

CS Minamishimabara-shi Power Plant (East & West)63,166

13,84052,63935,22424,367

S-11

CS Minano-machi Power Plant

35,34010,95023,64916,132

22,642

S-12

CS Kannami-cho Power Plant

19,545

7,872

15,373

9,662

12,045

S-13

CS Mashiki-machi Power Plant

661,218

167,511500,048

344,512

328,680

S-14

CS Koriyama-shi Power Plant

8,044

4,396

6,328

4,191

6,113

S-15

CS Tsuyama-shi Power Plant

24,321

12,54819,866

12,91417,003

S-16

CS Ena-shi Power Plant

26,266

14,224

22,576

14,51017,914

S-17

CS Daisen-cho Power Plant (A) (B)

326,253

268,083

320,933

214,567

273,403

S-18

CS Takayama-shi Power Plant

11,019

4,989

8,657

5,496

7,351

S-19

CS Misato-machi Power Plant

15,3007,717

11,747

7,594

11,270S-20

CS Marumori-machi Power Plant

32,391

15,151

30,526

17,036

17,016

S-21

CS Izu-shi Power Plant

155,81384,936

137,427

87,776

103,322

1,646,317

684,879

1,362,007

911,865

969,284

Total

8

2. Major Topics

9

AUM Snapshot◼ Summary of AUM as of the end of 6 th FP. The fund has 21 power plants with total panel output
of 120 MW and the total acquisition price is close to ¥50Bn.
<Portfolio as of the end of 6th FP># of projects

Panel output of AUM(Note)

21 projects

Total acquisition price asof the end of 6th FP¥48.84 Bn

119.7 MW

Total valuation price(Note)
as of the end of 6th FP¥49.58 Bn“Price” refers to the median project valuation report amount, which is the estimated values provided to us by PricewaterhouseCoopers Sustainability LLC and Ernst & Young
Transaction Advisory Services Co., Ltd. in its project valuation reports as of June 30, 2020.

◼ Historical valuation and book value (after depreciation)◼ Historical panel output of AUM
MW

JPY billion

150
3.2

100

10.7

30.3
2.5

50

72.7

10.7
3.2
30.3
2.5
72.7

（MW）

50

@ IPO

Acquired Acquired Acquired Acquiredin 2nd FP in 3rd FP in 4th FP in 5th FP

Total

Book value

50.02
47.09

45

42.07

40
35

0

Valuation price

55

30

33.86
30.44
@ IPO

51.49
46.47

49.58
45.57

42.67

35.96
31.11

2nd FP

3rd FP

4th FP

5th FP

6th FP

10COVID-19 Impacts on Index◼ Although the unit price had declined during the period from the end of February to the middle ofMarch due to COVID-19 , the fluctuation range and the impacts of the share price were limited
compared to TSE REIT Index and Nikkei Average Index (94.5% of the beginning of 2020 as ofJuly 31, 2020)◼ Volatility of the unit price was lower than those of TSE REIT Index and Nikkei Average Index
Historical Unit Price/Index (100 at January 6, 2020)

30-days Historical Volatility

110

120

100

100

90

80

80

60

70

40

60

20

50

0

CSIF Unit Price

TSE REIT Index

CSIF Volatility

Nikkei Average

TSE Infrastructure Index

Nikkei Average Volatility

TSE REIT Index Volatility

11Shelf Registration of Bond and Credit Rating◼ The first shelf registration of investment corporation bonds among the listed infrastructure funds

funds

Filing Date

Maximum Amountto be Issued

Issuance Period

Use of Proceeds

June 26, 2020

¥ 10 Bn

July 4, 2020 – July 3, 2022
(2 years)

Acquisition of assets, repayment ofloan, capital expenditures etc.

◼ Upgrade for JCR’s rating and newly obtaining R&I’s rating enable CSIF to broaden financesources and broaden the investors universe
Credit rating obtained after June 30, 2020
Rating Agency

Japan Credit
Rating Agency,
Ltd.
Rating andInvestment
Information, Inc.

Subject to Rating

Rating Date

Long-term Issuer Rating

RatingOutlook

BeforeAfter

July 31, 2020

A-

A

StableThe 1st Unsecured Investment
Corporation Bond (only for Qualified
Institutional Investors)

July 31, 2020

A-

A

-

Long-term Issuer Rating

August 7, 2020-

A-

StablePossible to execute flexible financial strategies with fulfilling credit ratings
12Debt Profile (1)TypeInitial amount(yen millions)

Outstanding(yen millions)Interest rate

Interest
rate type

Drawdown
date

Maturity

Longterm

15,70013,602

Base rate plus 0.45%(fixed at 0.845% upon executinginterest rate swap)

Fixed

31-Oct-2017

10 years from drawdown date
JCR Green Finance Evaluation

Longterm

8,000

7,210

Base rate plus 0.45%(fixed at 1.042% upon executinginterest rate swap)

Fixed

6-Sep-2018

10 years from drawdown date

Longterm

700643

Base rate plus 0.45%

Variable

29-Mar-2019

3 years from drawdown date

Longterm

4,500

4,377

Base rate plus 0.45%

Variable29-Nov-2019

2 years from drawdown date

Sub total of Loan

29,20025,832Longterm

1,100

1,100

0.71%

Fixed

6-Nov-2019

5 years from issuance date

Sub total of Bond

1,100

1,100

Total

30,30026,932Category

Loan

Bond

13

Debt Profile (2) – Lender Formation◼ Financial soundness attributed to fixed interest rate conversion. Although LTV has risen due
to acquisition and revaluation, LTV level is under stable controls. Fixed-to-valuable interest
rate ratio is also controlled at a higher level.
◼ LTV and ratio of fixed-to-variable rate loans
LTV (Note1)

Fixed-to-variable interest rate ratio (Note2)

as at end of December 2019as at end of June 2020

as at end of December 2019as at end of June 2020

53.74 %

54.31 %

80.48 %

81.36 %

(Note1) “LTV” are calculated without consumption tax bridge loan.
(Note2) “Fixed-to-variable interest rate ratio” refers to the ratio of fixed interest rate liabilities to total interest-bearing liabilities at that time.
Variable interest rate liabilities that were converted to fixed interest rate liabilities through interest rate swap agreements were deemed as fixed interest rate liabilities.

◼ Support by the stable lenders’ formation with
Shinsei Bank and 3 mega banks as the arranger
and co-arranger◼ Historical LTV
56.00%

54.31%
53.74%

54.00%
52.00%

Ashikaga
Bank

ResonaBank

Oita Bank

51.58%

50.00%

SMBC

49.78%Mie Bank

48.00%

44.67%

44.00%

Orix Bank

ShinseiBank

47.00%

46.00%MUFG

Hiroshima
Bank

ShonaiBank

MizuhoBank

42.00%
40.00%@ IPO

2nd FP

3rd FP

4th FP

5th FP

6th FP

Nanto
Bank

Tochigi
Bank

14

Impact of Curtailment by Kyushu Electric Power◼ Number of past cases of curtailment and estimated impacts. Business forecast for the future FP
includes estimated impacts. (9 out of 21 portfolio assets are located in Kyushu region)
FP

3rd

4th

5th

6th

No. of days of
implementation

8

48

13

71

No. of implementation at
CSIF power plants

12

117

21

249

Estimated rent income
decrease (thousand Yen)

¥3,833¥32,545¥3,750¥58,130

Ratio of estimated rent
income decrease to rent
income forecast

0.21%

1.54%

0.17%

2.47%

◼

出力制御の状況と本投資法人への影響◼

Kyushu Electric Power
commenced curtailment in
October 2018 in the 3rd FP.

◼

In the 4th FP, despite the◼
high frequency of
curtailment from March toMay, actual power
generation exceeded◼ In the 5th FP, the CSIF’s
forecasted amounts. Hence,
facilities were again subject toimpact to CSIF’s
curtailment from October 13,
performance was limited.
2019, but the impact◼
remained limited for the FP.
In the 4th FP, nocurtailments occurred after
May 13 because
inspections at the nuclear
power plants commenced,
and electric power demandrose in summer.

In the 6th FP, the curtailment
had seemed to have minor
impacts in view of ongoingregular inspections of thenuclear power plants,
measures against terrorist
attacks.
However, the impact of
curtailment increased in the
6th FP due the increase of thenumber of PV power plants in
Kyushu region and decreasein electricity demand by thecurrent situation with COVID19.

For the 6 th FP, ¥81,998 thousand is the estimated decrease in variable rent income based on the actual
irradiation for the days which curtailment were implemented at CSIF power plants.
15

Responses Related to Curtailment◼ Responding to the curtailment system for online operation introduced by Kyushu Electric Power at the CS
Mashiki-machi Power Plant
Key Points of the Curtailment System for Online Operation✓ Even at solar power plants subject to the 30-day rule, it is possible to transition from all-day control to hourly control
through retrofitting for online operation.
✓ If curtailments occur within a particular day, it is counted as “one day” regardless of the curtailment time, and the 30day upper limit is maintained.

Installation Work✓✓✓

Installation work is expected to be completed by the end of September
A curtailment controller from Fuji IT Co., Ltd. will be used. Instead of controlling inverters one unit at a time, thecontroller monitors overall inverter output and applies optimization. By implementing control after considering all loss
from the linkage point that represents the boundary of electric power selling for the power plant, it will also be
possible to sell electricity up to the upper limit of output.
Even when compared with construction work to covert the inverters, construction costs are around one-tenth.

In addition to migrating to hourly control, this is expected to reduce losses outside times whencurtailment is implemented and contribute to improve revenue from sales of electric power.
◼ Responding to the remote curtailment requests from Tohoku Electric Power at the CS Marumori-machi Power
Plant
✓
✓

Regarding solar power plant curtailment, we received subsequent confirmation from Tohoku Electric Power on inverter
modifications to establish a communication environment that allows remote control and started on the conversion after
approval.
The work is expected to be completed by the end of August.
16

Main Points of the Revised Renewable Energy Act(to take effect in April 2022)◼ Reserve Fund System for Power Generating Facility Decommissioning Costs
Categories subject to thereserve fund obligation

All certified solar power plant projects with an output of at least 10 kW

Reserve Method

Reserved externally with the Organization for Cross-Regional Coordination of Transmission Operators(OCCTO). On an exceptional basis, internal reserve funding is allowed if certain requirements are met

Reserve Period

For ten years prior to the end of the FIT period

Reserve AmountFor accredited projects whose procurement prices have already been determined by FY2019, the reserveamount is the level of assumed costs for decommissioning, etc. in the procurement price calculation
determined by the Procurement Price Calculation Committee◼ FIP Program✓This is a program to issue a certain premium on top of the market price (Subsidy for Supply Promotion).

✓

This support scheme represents another step towards the self-reliance of renewable energy in terms of how it is predicated onmarket transactions involving electricity generated from renewable energy.

✓

It is expected existing FIT programs will be revised or reduced so that they are only limited to power generators meeting regional
utilization requirements.

✓

In terms of targets of the FIP program, there is a high likelihood that large-scale commercial solar power generation and wind
power generation will be selected as “competing energy sources”.

✓

While based on a “fixed-rate premium FIP” linked with market prices, instead of being fixed over the entire program period, thepremium amounts are revised at regular intervals (from a month to around one year)◼ System to Automatically Nullify Certification of Power Plants with Delayed Start of Operation✓

To rectify situations in which grids are not being used effectively, the system nullifies the certification of projects that do notcommence operation within a certain period after obtaining certification.

17

Trends Concerning Changes to Other Important Systems(changes expected to take effect in 2023)◼ Power Producer-Side Base Charges<Intent of the System>
To ensure that renewable energy power producers bear a portion of the costs for maintaining and managing
transmission and distribution facilities based on the amount of power generated.

Depending on how the system
is designed, we recognize thatthe portion of costs borne by
renewable energies with a low
equipment utilization rate will
increase

For this reason, considerationand ingenuity will be required
to ensure that existing FIT
operators do not shoulder anexcessive cost burden

Proper consideration isimportant. This includes
designs related to adjustments
and levels made whileconsidering various indications
and feedback from relatedparties

Summary of an answer given by Minister of Economy, Trade and Industry Hiroshi Kajiyama during Diet deliberations on May 20

When examining power producer-side base charges, the following two points should be given adequate
consideration:(1) Taking into account the situation of renewable energy power producers that have been certified under the
FIT scheme(2) Ensuring that renewable energy power producers are not notably disadvantaged in comparison to otherpower producers
Summary of supplementary resolution made by the House Of Representatives Committee on Economy, Trade and Industry on May 22

18

Efforts for Sustainability◼ Signatory to UN PRI
As of August 13, 2019, our asset manager, Canadian
Solar Asset Management K.K. (“CSAM”), became thefirst Japanese infrastructure investment corporation to
be a signatory to the UN PRI. CSAM intends toincrease its activities for more progress with regards to
ESG issues and its committed to engaging in
responsible investment management through PRI
practices to make contributions to social responsibility.

◼ External Certification and Recognition Related to ESG
On May 11, 2020, we obtained Green 1 (F) rating, thehighest overall rating in the JCR Green Financeevaluation, for the framework we established to limit
the use of funds procured through green bonds andgreen loans to those with environmental improvement
effects.

JCR Green Finance Evaluation Matrix
Management, Operation and Transparency
m1◼ Preparations to Formulate ESG Framework Policies

m3

m4

m5

(Highest
rating)

Green 2

Green 3

Green 4

Green 5ｇ2

Green 2

Green 2

Green 3

Green 4

Green 5

ｇ3

Green 3

Green 3

Green 4

Green 5

ｇ4

Green 4

Green 4

Green 5

g1

Greenness

In ESG framework policies to be established going
forward, we will clarify how to incorporate ESG factors
in the series of processes from the screening ofinvestment projects to due diligence, asset acquisition
and asset management.

m2

Green 1Out of Scope

ｇ5

Green 5

Green 519

Green Finance◼ Obtaining JCR Green Finance Rating

1 Issuance of Green Bonds

2

New Rating

Obtaining a Rating for Individual Financing
Ongoing Rating
In the Green Finance Evaluation conducted by JCR, thehighest overall Green 1 rating was awarded on November
22, 2017 in consideration of the use of funding andmanagement, operation and transparency of theinvestment corporation with regard to a 15.7 billion yen loan
made on October 31, 2017, which was appropriated forsome of funding for assets acquired when the corporation
was listed. As a result of an annual review, the rating was
retained on February 13, 2020.

We plan to issue investment corporation bonds basedon green finance framework. For these bonds, on
August 14, 2020 we obtained a provisional rating (thehighest rating of Green 1) as green bonds. For
financing related to future property acquisitions, we will
actively consider obtaining a green finance rating.

We will work to maintain a strong environmental awareness when procuring funds and continue toactively tackle environmental issues to improve investor value.
Green1(the best rating

1

Stake
Holders

Periodical
reporting foruse of funds
andenvironmental
improvement
effects

Assets to be acquired in the
future石狩新篠津村発電所

Investment
corporation bonds(green bonds)

Investors
for bonds

Loan（JPY 15.7 Bn）

Financial
institutions

CS大崎市化女沼発電所

Assets at IPO

CS Mashiki-machi
Power Plant

2

Equity by PO

Green1(the best rating)20

3. Management Policy

21New Assets to be Acquired◼ The first PV power plant in Hokkaido region for CSIF and area diversification will proceed(after the acquisition… Kyushu region: 9 assets, other region: 14 assets)
CS
Ishikari
Shinshinotsu-mura
Power
Plant
S-22
CS Ishikari Shinshinotsu-mura Power
Plant

Project Name
Planned Acquisition Date

September 1, 2020

Acquisition Price¥680,000,000

Location

Shinshinotsu-mura, Ishikari-gun, Hokkaido

Operator

Canadian Solar Projects K.K.

O&M Servicer

CSOM JapanEPC Servicer

Shanghai Electric／K.K. Yashiro

Summaryof SpecificContracts

Land

FacilityArea

42,977㎡

Land Rights

Ownership

COD

July 16, 2019

FIT
Expiration

July 15, 2039

Panel Type

Polycrystalline silicon

Panel Output

2,384.6kW

Output Capacity

1,990kW

Panel
Manufacturer
Invertermanufacturer

Canadian Solar GroupPower Generation
Company

CS Hokkaido Ishikari G.K.

Electric Power
Purchasing
Company

Hokkaido Electric Power Network, Inc.

Frame Structure

Screw foundation¥24/kWhFirst year projected
capacity factor

12.61%

Area

26,051㎡

Land Rights

Ownership

COD

July 22, 2019

FIT
Expiration

July 21, 2039

Panel Type

Polycrystalline silicon

Panel Output

954.9kW

Output Capacity

600kW

Purchase
Price

Sungrow Power Supply Co., Ltd.

S-23 CS Osaki-shi Kejonuma Power Plant
Project Name

CS Osaki-shi Kejonuma Power Plant

Planned Acquisition Date

September 1, 2020

Acquisition Price¥208,000,000

Location

Furukawa, Osaki-shi, Miyagi

Operator

Canadian Solar Projects K.K.

O&M Servicer

CSOM JapanEPC Servicer

Sungrow Power Supply Co., Ltd.

Summaryof SpecificContracts

Land

Facility

Panel
Manufacturer
Invertermanufacturer

Canadian Solar GroupPower Generation
Company

CS Miyagi Kejonuma G.K.

Electric Power
Purchasing
Company

Tohoku Electric Power Network Co., Inc.

Frame Structure

Screw foundation

PurchasePrice¥21/kWhFirst year projected
capacity factor

11.21%

Sungrow Power Supply Co., Ltd.

22

7 th, 8 th & 9 th FP Business Forecast◼ Business Forecast
7th Fiscal Period(ending December 2020)

8th Fiscal Period(ending June 2021)

9th Fiscal Period(ending December 2021)

Statement of Income (million yen)

2,426

2,366

2,428

Operating profit

887

823

871

Ordinary profit

706

674

706

Current net profit

705

673

706

DPU (incl. distributions in excess of earnings)

3,700 yen

3,700 yen

3,700 yen

DPU (excl. distributions in excess of earnings)

3,052 yen

2,912 yen

3,055 yen

648 yen

788 yen

645 yenOperating revenue

Per unit distributions in excess of earnings

Congruent with CSIF’s policy to maintain stable levels of distributions, projected DPU for 7 th
FP (ending Dec. 2020) , 8 th FP (ending Jun. 2021) and 9 th FP (ending Dec. 2021) is ¥3,700(Note-1) Figures are rounded down to the nearest million yen.
(Note-2) Above forecasts are based on earnings summary dated February 13, 2020 and is subject to change due to factors including without limitation, acquisition or sale of renewableenergy projects, changes in infrastructure markets, fluctuation in interest rates and other changes in circumstances surrounding CSIF. Forecasts do not guarantee any
dividend amounts.

23

Historical and Forecasted Dividend◼
◼
◼
◼

3,700 yen of DPU for the 6 th FP, increased by 50 yen from the 5 th FP
Realized stable dividends in the five FPs after IPO
DPU of 3,700 yen is forecasted for the 7 th – 9 th FP
The fund aims to achieve a stable and sustainable distribution payout by utilizing distributions inexcess of earnings
（円）

4,000

3,650

3,600
3,500

3,700

3,700

708

648

788

645

2,992

3,052

2,912

3,055

6th Fiscal
Period
第6期

7th Fiscal
Period
第7期(Forecast)

577

3,000

2,350

3,700

3,700

3,650

1,340
1,817

2,500
2,000

808
3,073

1,500

2,310

1,000
1,542

1,783

500
0
2nd Fiscal Period

第2期

3rd Fiscal Period

第3期

4th Fiscal Period

第4期

5th Fiscal
第5期Period（予想）

1口当たり分配金（利益超過分配金を含まない）

8th Fiscal
Period
第8期(Forecast)（予想）

9th Fiscal
Period
第9期(Forecast)（予想）

1口当たり利益超過分配金(Note) Figures for the 7th~9th Fiscal Period are forecasts and are subject to change. They do not represent guaranteed distribution amounts.

24

External Growth Strategy（Sponsor Pipeline）(the numbers are as of the end of Jun. 2020)◼ Achieve ¥100Bn in asset size within 2 years by mainly acquiring assets from sponsor pipeline◼ Sponsor portfolio snapshot
FIT purchase price range: Mostly ¥32~¥40/kWh
Fully taking advantage of vertically-integrated model,
actively develop new projects with lower FIT price

2

24.7%
50MW~
10MW~50MW
5MW~10MW
2MW~5MW
~2MW

7
6
4

Operational

Under construction

400.0
171.6

300.0

16.0%
￥40/kWh￥36/kWh￥32/kWh￥24/kWh￥21/kWh~￥20/kWh

6.5%
3.9%
5.0%

43.9%

Under development
30.0

ENR projects

15.6
65.4

26.7

44.4

1.2

CS Hiroshima Suzuhari
PP (17.9 MW)
CS Yamaguchi Hofu PP(7.0 MW)● Operational● Under construction● Under development● Acquired by CSIFCS Gunma Takasaki KG
PP (24.5 MW)
CS Gunma Minakami PP(19.0 MW)CS Miyagi Angel Land
PP (9.2 MW)(20.1 MW)CS Miyagi Ogawara PP(7.2 MW)CS Okayama Shinyubara
PP (30.0 MW)

CS Azuma Kofuji PP(100.0 MW)
CS Tochigi Kitsuregawa
PP (1.2 MW)

CS Oita Hiji PP(53.4 MW)65.4

CS Ibaraki Kurusu PP(11.3 MW)CS Oita Munechika PP(8.2 MW)CS Kumamoto Mashiki
Dai-ni PP (1.2 MW)

72.4
1.8

CS Kumamoto Yamato
PP (1.2 MW)

CS Hokkaido Ishikari PP(2.4 MW)CS Miyagi Kejonuma PP(0.9 MW)CS Gifu Kamitakara PP
CS Fukuoka Saigawa PP(13.0 MW)CS Fukuoka Tagawa PP(0.8 MW)354.9MW

217.2

0.0

25projects, 354.9MW◼ Map of owned assets and sponsor assets
CS Shimane Hamada PP(2.0 MW)

200.0
100.0

10projects, 187.0MW

ENR projects (Note)
1.8MW◼ Operational start year and status ofsponsor portfolio assets（MW）

15projects, 169.9MW

Total sponsor portfolio

Under development

By FIT price (panel output)

By size (per asset)

5

Operational and underconstruction

CS Saitama Kumagaya
PP (2.0 MW)

CS Ibaraki Kasama PP(12. 0 MW)

CS Hiroshima
Fukuyama PP (3.4 MW)

CS Higashikagawa PP(2.6 MW)CS Higashikagawa
Dai-ni PP (2.1 MW)

Source: Compiled by the Asset Manager based on disclosures by Canadian Solar Projects K.K.
Note: Total panel output of ENR projects are based on development plans as of June 30, 2020. Forecasted output and actual output may differ. Licenses and permits for ENR project development may not be completed and there is no assurance
that these projects will reach completion nor be ready for commercial operation. With respect to these ENR projects, CSIF has been granted Exclusive Negotiation Rights from project developers. As at June 30, 2020, the sponsor does notretain ownership of these projects and there is a likelihood that the sponsor will not acquire the project among other reasons. As at June 30, 2020, CSIF does not intend to acquire these projects and there is no assurance that CSIF will
acquire these projects.

25Appendix

26

Overview of Sponsor◼ Canadian Solar Group’s history◼ Canadian Solar Group’s Global Operations

Founded in Ontario, Canada, 2001
Listed on NASDAQ (CSIQ) in 2006

1

5

1
6

2

Over 13,000 employees globally
Presence in 20 countries/territories
Delivered solar panels amounting to over 43 GW total
capacityOver 10 GWp solar power plants build and connected
globally (incl. Recurrent Energy)

3
1 Canada
2 U.S.
3 Mexico
4 Brazil
5 Germany
6 Spain
7 China
8 South Africa
9 UAE
10 India
11 Singapore
12 Japan
13 Korea
14 Australia

9Entered the Japan market in 2009 and established proventrack record for shipping PV modules

10

12

13

3 7

17 18 6
16
5
19
4
11

20

2 4
14

8

15
16
17
18
19
20

Italy
VietnamHong Kong
TaiwanThailandIndonesia

1
2
3
4
5
6

CanadaBrazilChina
Thailand
VietnamTaiwanAs of Jun. 30, 2020
●Base of sales◆Base of manufacturing

Source: Compiled by the Asset Manager basedon “Investor Presentation as of Dec. 9, 2019”
by Canadian Solar Inc.

The manufacturer of the most “Bankable” (qualified as
lending subject) solar power module（by Bloomberg New Energy Finance 2019 Module Bankability Survey,
Canadian Solar, Inc. disclosed in “Investor Presentation” as of Dec. 9, 2019）15

Canada (2009)

U.S. (2010)(Note) There is no assurance that we can acquire the solar energy projects showed in the above
pictures in the future as of this writing.

27Vertically-integrated Business Model
GrowthPV plant

Acquire PV
plants

Project owner
CS Mashiki-machi
Power Plant

Own and lease solar
energy projects

Canadian Solar Infrastructure Fund,
Inc.

ProvideO&M
services
PV plant
management

Lease PVfacilities
PV plantdevelopment

Module

Cell

Wafer

Ingot
SiliconCanadian Solar Group (incl. sponsor)

Developer
Canadian Solar Projects K.K.

O&M provider
Canadian Solar O&M Japan K.K.

28

Overall Structure◼ Identical structure as a typical J-REIT◼ Our revenue is derived from rent income of solar energy projects
Canadian Solar Asset Management K.K.
Engaged in asset management in Canadian Solar
Infrastructure Fund, Inc.
⚫ Established in June 2016⚫

Canadian Solar Projects K.K. (Sponsor)(Sponsor / Operator)⚫ Engaged in construction and operation of solar
energy facilities⚫ Established in May 2014

Asset
Management
Agreement

AssetManagerSponsorSupportAgreement

Distributions

Investment
Corporation(Fund)

Provides O&M services to solar energy facilities
including our currently-owned projects⚫ Established in June 2016

Loan
Agreements

Lenders

Sponsor /Operator
O&M Service
Agreement

Solar Energy
Projects
Lease /
Purchase
Agreements

Sales of PV modules for use in residential andindustrial solar power systems⚫ Established in June 2009

Landowners

O&M

Lease / Operation
Agreement

Canadian Solar Japan K.K.
⚫

EquityEquityInterest

Canadian Solar O&M Japan K.K.
⚫

Investors

Asset Management
Service Agreements

LesseeOperator
SPC, etc.

Utilities
PPAs /
Interconnection
Agreements

29

Unit Price Performance◼ Approximately 5% decline in CSIF’s unit price for the 1st half of 2020 (vs. 22% decline for TSE
REIT Index)◼ Stabilized performance of CSIF’s unit price compared to Nikkei Average Index and TSE REIT Index
in the market with large fluctuation due to COVID-19
TSE REIT
index

Unit price(yen)
Volume (right axis)

Unit price (left axis)

130,000

TSE REIT Index (left axis)

Unit price at ending of 6th FP: 114,100 yen
Forecasted 6th FP DPU: 3,700 yen
DPU yield: 6.4% (annual)
5,000

2,350
4,500
2,150

1,950

120,000
4,000
110,000

100,000
1,750

1,550

1,350

Unit price at beginning of 2020: 119,600 yen
Forecasted 5th FP DPU: 3,650 yen
DPU yield: 6.1% (annual)

3,500
3,000
2,500

90,00080,000

2,000
1,500
1,000

1,150

70,000500
60,000030

Status of Unitholders◼ Unitholding (as at period-ended June 2020)◼ By unitholding amount◼ By unitholders■ Individuals / others# ofInvestment
units:
231,190

128,197units (55.45%)■ Individuals / others

11,706 (97.50%)

20,183units ( 8.72%)■ Financial institutions

38 ( 0.31%)■ Financial institutions(incl. financial instruments firms)■ Domestic corporates

50,934units (22.03%)# ofUnitholders:
12,005■ Foreign entities & individuals 31,876units (13.78%)

Name(incl. financial instruments firms)■ Domestic corporates

195 ( 1.62%)■ Foreign entities & individuals

66 ( 0.54%)

Number ofinvestment units
held (units)

Unitholding ratio to total issued
units (％)

1

Canadian Solar Projects K.K.

33,89514.66%

2

State Street Bank And Trust Company

10,731

4.64%

3

UBS AG LONDON A/C IPB SEGREGATED CLIENT ACCOUNT

6,558

2.83%

4

The Bank of Fukuoka, Ltd.

3,510

1.51%

5

THE BANK OF NEW YORK

3,444

1.48%

6

THE BANK OF NEW YORK MELLON

2,712

1.17%

7

THE FUKUHO BANK, LTD.

2,440

1.05%

8

CITIBANK INTERNATIONAL PLC AS STANDARD LIFE WEALTH PHOENIX FUND

2,437

1.05%

9

Individual investor

2,041

0.88%

10

Individual investor

2,020

0.87%

69,78830.14%

Total(Note): Unitholding ratio is rounded down to the nearest hundredth.

31Balance Sheet for 6th FP◼ 6 th Fiscal Period (ended June 2020)◼ Assets(in thousands of yen)

Operating accounts receivable

2,627,638
477,976

Prepaid expenses

109,917

Other current assets

1,799

Total current assets

3,217,332

Cash and bank deposit

Fixed assets
Property and equipment
Structures
Accumulated depreciation
Total structures (net)
Machinery and equipment

1,041,843(85,025)
956,818
42,736,685

Accumulated depreciation(3,880,573)

Total machinery and equipment (net)38,856,111

Tools, equipment and supplies

592,249

Accumulated depreciation(55,331)

Total tools, equipment and supplies (net)536,917Land

4,469,653

Construction in progress
Total property and equipment

44,830,061

10,560Intangible assets
Leasehold rights
SoftwareTotal intangible assets
Investments and other assets
Long-term prepaid expenses
Deferred tax asset
Guarantee deposits
Total investments and other assets
Total fixed assets
Deferred assets
Investment corporation bond issuance cost
Total deferred assets
Total assets◼ Liabilities and Net Assets(in thousands of yen)

Current liabilities

Current assets

753,1391,960
755,099
284,425
15
37,790322,230

Accounts payable (other)
Long-term borrowings to be repaid within
1 year
Accounts payable
Accrued expenses
Income taxes payable
Consumption taxes payable
Deposits received
Total current liabilities

29,9581,534,806
78,655
155,410922
203,692301
2,003,746

Fixed liabilities
Investment corporation bondLong-term borrowings
Total fixed liabilities
Total liabilities
Unitholders’ equity
Unitholders’ capital
Amount deducted from Unitholders’capitalUnitholders’ capital (net)
Surplus
Unappropriated retained earnings(accumulated deficit)
Total surplus
Total unitholders’ equity
Total net assets
Total liabilities and net assets

1,100,000
24,297,106
25,397,106
27,400,853
22,050,175(1,010,472)
21,039,702
691,823
691,823
21,731,525
21,731,525
49,132,379

45,907,391

7,656
7,656
49,132,379

32

Statement of Income for 6th FP◼ 6 th Fiscal Period (ended June 2020)(in thousands of yen)

Operating revenues
Rental revenues
Total operating revenue
Operating expenses
Rental expenses of renewable energy projects
Asset management fee
Administrative service fees
Director’s compensation
Tax and dues
Other operating expenses
Total operating expenses
Operating profit
Non-operating income
Interest income
Interest on refund
Total non-operating income
Non-operating expenses
Interest expenses

2,331,291
2,331,291
1,362,007
59,407
19,4022,400
101
47,603
1,490,922
840,36913
400
413
112,576

Interest expenses on investment corporation
bond

3,894

Amortization of investment corporation bondissuance expenses

879

Borrowing-related expenses
Total non-operating expenses
Ordinary income
Income before income taxes
Income taxes
Income tax adjustments
Total income taxes
Net income
Profits brought forward
Unappropriated retained earnings(accumulated deficit)

30,701
148,053
692,729
692,729924(2)921
691,80716
691,82333

Portfolio◼ As at period-ended June 2020
S-01 CS Shibushi-shi
Power Plant 1.2MW

S-02 CS Isa-shi
Power Plant 0.9MW

S-03 CS Kasama-shi
Power Plant 2.1MW

S-04 CS Isa-shi Dai-niPower Plant 2.0MW

S-05 CS Yusui-cho
Power Plant 1.7MW

S-06 CS Isa-shi Dai-sanPower Plant 2.2MW

S-07 CS Kasama-shi Dai-niPower Plant 2.1MW

S-08 CS Hiji-machi
Power Plant 2.6MW

S-09 CS Ashikita-machi
Power Plant 2.3MW

S-10 CS Minami Shimabara-shi
Power Plant (East & West) 3.9MW

S-11 CS Minano-machi
Power Plant 2.4MW

S-12 CS Kannami-cho
Power Plant 1.3MW

S-13 CS Mashiki-machi
Power Plant 47.7MW

S-14 CS Koriyama-shi
Power Plant 0.6MW

S-15 CS Tsuyama-shi
Power Plant 2.0MW

S-17 CS Daisen-choPower Plant (A&B)

S-18 CS Takayama-shi
Power Plant 1.0MW

S-19 CS Misato-machi
Power Plant 1.1MW

S-20 CS Marumori-machi
Power Plant 2.2MW

S-21 CS Izu-shi
Power Plant 10.7MW

S-16 CS Ena-shi
Power Plant 2.1MW

27.3MW

34

Leasing Structure◼ Calculation method of basic rent and variable rent in anticipated projects to be acquired
Basic rentMonthly projected energy output (P50) ×(100－Y)% × 70% × FIT purchase price

Variable rent(Monthly actual energy output × (100－Y)% × FIT purchase price) － Basic rent

⚫ Even if actual energy output is lower than projected energy output (P50), the operator will be able to receive basic rent from lessee⚫ If actual energy output exceeds 70% of projected energy output (P50), possible to obtain variable rent

◼ Diagram of rent structure
Projected revenue from sales of electricity(before deducting lessee’s operating costs andoperator compensation)
×Y％

Projected energy output (P50)
×FIT purchase price

Rental income of Canadian Solar
Infrastructure Fund, Inc.

Projected energy output (P50)
×FIT purchase price×(100-Y)%
Variable rent

Projected energy output (P50)
×FIT purchase price × X%
×Y％Projected energy output (P50)
×FIT purchase price × X%
×(100-Y)%

Basic rent

Projected energy output(P50)×X%

Projected energy
output (P50)

Note-1: Projected energy output (P50) is monthly predicted solar energy output inlease term as described in technical reportNote-2: Y is percentage based on lessee’s operation cost and operator compensation
Note-3: Negative variable rent is regarded as zero

Actual energy output

35

Distribution Policy (Payout Ratio)◼ Distribution policy focusing on payout ratio⚫ Cash distributions to our unitholders for each fiscal period are calculated by multiplying the residual free cash flow(“NCF”), which refers to free cash flow (“FCF”) minus debt interest payments, by a payout ratio, which is determinedby us for each fiscal period.

◼ Distribution in excess of earnings
Expenses ofleasing business

Expenses ofleasing business

Debt interest

Capital expenditure

Debt interest

Total rental
revenues

FCF made by
renewable energy facilities

Use forreinvestment
Up to 60%of depreciation

Debt repayment

Depreciation

Retained earnings
Residual FCF(NCF)

Revenue

Expenses

Residual FCF
×Payout ratio

Cash distribution

Distribution

Distribution inexcess of earnings
Distribution
from profit

Net income

Breakdown

P/L(Note-1) Residual FCF is calculated as free cash flow minus interest payments related to interest-bearing debt and repayments of interest-bearing debt for the relevant fiscal period plus
total amount of net cash flow remaining after deduction of distributions from the preceding fiscal periods.
(Note-2) Our calculation method of payout ratio differs from that of other enterprises (i.e. cash distribution divided by current income).
(Note-3) Under the standards set forth by the Investment Trusts Association, Japan, closed-end infrastructure funds, such as us, may return capital up to 60% of the amount obtainedby deducting the amount of their accumulated depreciation recorded as of the end of the preceding fiscal period from the amount of their accumulated depreciation calculated
as of the end of the relevant fiscal period.
(Note-4) The chart above is presented solely to facilitate a general understanding of the mechanism for cash distributions, and does not represent the share of our rental revenues orcash distributions in excess of retained earnings. We may decide not to make any amount of cash distributions in excess of retained earnings for a particular fiscal period,
based on a consideration of factors such as economic or renewable energy market conditions or our financial condition, among other factors, after taking into account our
financial situation and alternative uses of cash, such as the execution of repair plans and capital expenditures, the repayment of borrowings and property acquisition
opportunities. We may, in place of making cash distributions in excess of retained earnings, decide to acquire our own units.

36

Characteristics of PV Plant Revenue◼ Forecastability of earning stability on a long-term basis⚫ FIT price and FIT period of our PV plants are binding in accordance with the Feed-in-Tariff system. Moreover, giventhat our assets-under-management are set up so that we can capture basic rent from the lessee, we assume that any

decline in rent income won’t exceed a certain limit.
⚫ Given that expenses on depreciable assets are largely fixed, earnings forecasts can be realistically projected for the
long-term.
◼ Dynamics of PV plant revenue during FIT period○ Assuming that we purchase PV projects and do not purchaseAmountOperatingexpenses

Operatingrevenues

Net income
Non-operating
expensesTime

additional assets nor sell them, fluctuations in operating revenue,
operating expenses and non-operating expenses during the FIT
period will follow the general tendencies listed below. Hence, ourunderstanding is that CSIF’s current income will gradually increaseover the medium to long term during the FIT period.
○ Operating revenues generally decrease gradually over the medium tolong term due to expected deterioration of PV modules.
○ Operating expenses generally decrease (mainly composed of taxes
on depreciable assets that are calculated using the straight-line
method) gradually over the medium to long term, under thepresumption that expenses other than taxes on depreciable assets
are largely fixed (including assumed regular maintenance costs).
○ Amortization payments of loan principal and interest rates that are
partially fixed generally cause non-operating expenses to decrease
gradually over the medium to long term given typical amortization
schedules, as these payments are the primary component of nonoperating expenses.

37

History of CSIF
Date

Event

April 21, 2017

Notification on incorporation of the Investment Corporation by the organizer (Canadian Solar Asset Management K.K.) in
accordance with Article 69, Paragraph 1 of the Investment Trust Law

May 18, 2017

Registration of incorporation of the Investment Corporation in accordance with Article 166 of the Investment Trust Law,
Company Incorporation

May 25, 2017

Application for registration of the Investment Corporation in accordance with Article 188 of the Investment Trust Law

June 9, 2017

Prime Minister's approval of registration of the Investment Corporation in accordance with Article 187 of the Investment
Trust Law (Kanto Regional Finance Bureau Director-General Registration No. 127)

July 11, 2017

Amendment of Articles of Incorporation

October 30, 2017

Listing on Tokyo Stock Exchange (Securities Code:9284)
Acquisition of 13 power plants (AUM: 13 power plants, total acquisition price JPY30.4Bn and total panel output 72.7MW)

February 1, 2018

Acquisition of 2 power plants (AUM: 15 power plants, total acquisition price JPY31.4Bn and total panel output 75.2MW)

September 6, 2018

Follow-on Offering
Acquisition of 3 power plants (AUM: 18 power plants, total acquisition price JPY42.9Bn and total panel output 105.6MW)

March 1, 2019

Acquisition of 1 power plants (AUM: 19 power plants, total acquisition price JPY43.3Bn and total panel output 106.7MW)

March 28, 2019

Amendment of Articles of Incorporation

March 29, 2019

Acquisition of 1 power plants (AUM: 20 power plants, total acquisition price JPY44.2Bn and total panel output 108.9MW)

November 29, 2019

Acquisition of 1 power plants (AUM: 21 power plants, total acquisition price JPY48.8Bn and total panel output 119.7MW)

38

Renewable Energy Market in Japan◼ Renewable energy mix and comparable energy self-sufficiency by country⚫ At the Paris Climate Change Agreement, Japan pledged to reduce CO emissions by 26% (vs. 2013 levels) by 2030
◼ Comparable renewable energy mix (2017)◼ Comparable primary energy self-sufficiency amongst OECD

100%

792.6%

No.1 Norway
No.2 Australia
No.3 Canada

80%

306.0%
173.9%
92.6%

No.5 U.S.
60%

No.11 UK
No.18 France40%

2 2014 :23.3%→2017 :30.5%

2 2014:3.2％→2017:8.1％

20%

68.2%
52.8%

No.22 Germany

36.9%

No.28 Spain

26.7%

No.33 Korea
No.34 Japan
No.35 Luxembourg

16.9%
9.5%
5.3%

2018:11.8%

0%Germany

Spain

U.K.

Renewable Energy(excl. hydropower)
Coal
Natural gas

France

U.S.

Japan

Hydroelectric energy
Petroleum, etc.
Nuclear energy0%Source: Compiled by the Asset Manager based on METI’s “Japan’s ENERGY (2019 EDITION)” dated Feb. 2020

100%

200%

300%

400%

500%

600%

700%

800%

900%

Source: Compiled by the Asset Manager based on METI’s “Japan’s ENERGY (2019 EDITION)” dated Feb. 2020.
Note: Figures for countries excluding Japan were based on data from “Energy Balances of OECD Countries 2017” by the IEA.
Figuresfor Japan were based on data from “Comprehensive energy statistics of Japan”(April 2019) by METI.

◼ Changes in the energy market⚫ METI projections of future energy mix and medium-long term changes to FIT purchase price◼ Installed solar capacity… METI predicts solar energy◼ Trends in FIT purchase price and average system costs ofwill comprise 7% of total 2030 energy mix

solar energy projects (2012-2019)

(GW)
80.0
70.0
60.0
50.0
40.0
30.0
20.0
10.0
0.0

(¥/kWh)
50

64.0

Note:

42.2
37.2

50.2

40

36

25

34.1

32

32.4

31.5

30

28.6

(ten thousand
yen/kWh)
50

26.6
25

29
24

21

18
12.98

0
September 2019

Source:FIT Purchase Price (500kW~2,000kW) (Left Axis)
買取価格（500kW以上2,000kW未満）（左軸）10kW以上の太陽光発電設備のシステム費用の平均値（右軸）Average system cost (Right Axis)

2030 Forecast

Compiled by the Asset Manager based on the following: data from METI website, “Long-term Outlook ofEnergy Supply and Demand (July 2015) by METI, “FY2015 Annual Report on Energy (Energy White Paper
2016)” by METI and data from the Federation of Electric Power Companies.
Projection for FY2030 is based on the percentages and installed capacity disclosed in the reports preparedby METI and are not based upon our calculations. There is no guarantee that the projected percentages orcapacity will be realized.

0
2012

2013

2014

2015

2016

2017

2018

2019

Source: Compiled by the Asset Manager based on “Report on Procurement Prices after FY2020 (February 4, 2020)” by METI.
(Note-1) FIT purchase price for each year based on a period from April to March of the following year and excludes
national and local consumption taxes.
(Note-2) Average system costs are based on the calendar year.
(Note-3) The purchase price in 2019 is the weighted average contract price stated in the "Results of the 4th Solar Power Bid(1st half FY 2019)" issued by Green Investment Promotion Organization

39

Disclaimer• This document has been prepared to provide information, and is not for soliciting and inviting investments in orrecommending transaction of certain products. We request investors to make investments with their own
responsibility and judgment.
• This document does not constitute a disclosure document or a management report based on the Financial
Instruments and Exchange Act, the Act on Investment Trusts and Investment Corporations or the listing regulationsof the Tokyo Stock Exchange.
• In addition to information on Canadian Solar Infrastructure Fund, Inc. (the "Investment Corporation"), this document
includes figures, tables and data prepared by Canadian Solar Asset Management K.K. (the "Asset Manager") based ondata/index and other information released by third parties. Analysis, judgment and other views of the Asset Manager
on such information at the time of preparation are also included in this document.
• The information contained in this document is not audited and there is no assurance of the accuracy and certainty ofsuch information. Analysis, judgment and other non-factual views of the Asset Manager represent views of the AssetManager at this point in time. Different views may exist or the Asset Manager may change its views in the future.
• Figures under the same items of other disclosed materials may differ from figures presented in this document due todifference in the rounding of fractions, etc.
• While the Investment Corporation takes reasonable care in the preparation of this document, there may be errors.
Readers are also cautioned that the contents of this document may be corrected or changed without prior notice.
• The Investment Corporation and the Asset Manager assume no responsibility for the accuracy of data, indexes andother information released by third parties.
• This document includes statements regarding future policies, etc. of the Investment Corporation. However, thesestatements do not guarantee said future policies, etc.
• For the convenience of preparing graphs, the dates indicated herein may differ from actual business dates.

40